2020 may have been a rough year, but it didn't stop investors flocking to fintechs.
European fintechs raised more capital in 2020 than any other industry — raking in $9.4bn between January and early December, spurred by a handful of giant rounds.
Funding saw a brief dip in March after coronavirus dampened investing appetite, but funding picked up again in the second and third quarter. The year also ended better than expected, with a flurry of deals announced in the lead up to the holiday period.
Based on the available data, here are the 10 biggest funding rounds in European fintech this year:
1) Klarna raised $650m in September, following on from its $200m raise in January
Swedish buy-now-pay-later company Klarna has become the darling of the VC world this year.
Its September raise was the biggest of the year and made the company Europe’s most valuable fintech, as well as giving it a $10.65bn valuation ahead of its rumoured IPO.
The company benefited from a surge in online shopping during the pandemic, with app downloads up 95% year-on-year across the US, Sweden, Germany and UK, according to data from App Annie. The company also reportedly brings on 200 new retail clients every day.
The September round was led by US private equity group Silver Lake, who put in $500m, while the January funds came from the Commonwealth Bank of Australia, whose total stake in Klarna now stands at 5.5%.
In total, the company raised $850m across the two fundraises this year.
Sifted spoke to Klarna CEO Sebastian Siemiatkowski earlier in December, about the ethics of lending and the unusual competitors he obsesses over.
2) Revolut raised $580m (Feb/July)
London-based fintech Revolut secured a $5.5bn after its mammoth Series D this year.
The company raised in two tranches, announcing a $500m funding round in February, led by US VC firm TCV, whose portfolio also includes Netflix, Spotify and Facebook. It then announced an extra $80m extension in July to bring in a US private equity firm, TSG Consumer Partners.
However, in August, the company reported losses of £107.4m across 2019, up from the £32.8m in losses it reported for 2018.
The fintech’s revenues were up 180% from 2018 to 2019, however, and CEO Nikolay Storonsky announced the company quietly broke even in November this year, putting in on course for far stronger financials by the end of 2021.
To date, Revolut has now raised a total of $916.5m.
3) Tink raised €175 (Jan/Dec)
Swedish fintech Tink raised €90m in January before extending the round and raising a further €85m in December, from investors including Dawn Capital, HMI Capital and Insight Partners.
Tink, founded in 2012, started as a consumer-facing finance app but has shifted to become an open banking platform that enables banks, fintechs and startups to use data to develop personalised financial services.
In September this year, Tink acquired OpenWrks, a UK-based provider of open banking applications.
4) Auxmoney raised €150m (Sept)
German peer-to-peer lending platform Auxmoney secured €150m in September led by Centrebridge Partners, which became a majority shareholder in the company.
Auxmoney, which is also backed by Index, announced it was profitable in 2018 but does not disclose official figures.
The $150 funding round was purely an equity raise, but the company also announced a $500 debt finance line with BNP Paribas in November.
5) Checkout.com raised $150m (June)
British payments startup Checkout.com tripled its valuation to $5.5bn after closing its Series B funding round at $150m in June.
The company was buoyed by a strong boom in demand amid coronavirus lockdowns — reportedly seeing transaction volumes in May go up by 250% year-on-year.
The company is used by thousands of merchants, including Deliveroo, to process online payments, connecting them with card providers like Visa or Mastercard. It claims to be the fastest provider in over 150 currencies.
CEO Guillaume Pousaz told Sifted in December that part of its new funds will be used to invest in other startups, having launched a venture division.
- Who topped the funding list in 2019? Check it out here
6) Starling raised £100m (Feb/May)
Starling brought its funding total for the year to £100m in May, adding another £40m to the £60m tranche it announced earlier in the year.
Investors in the UK-based bank, which was founded by banking veteran Anne Boden, include Merian Global Investors and Harry McPike’s JTC.
This year Starling also became the first digital bank of its kind in Europe to break even. After reporting a loss every month since its launch in 2014, it reported £9m in revenue for October 2020 and an operating profit of £0.8m for the month.
7) Qonto raised €104m (Jan)
Qonto, a neobank for small businesses and freelancers, raised €104m in January. At the time, this was the largest ever funding round for a French fintech.
Founded in 2017, Qonto is now used by 65,000 companies, and has raised €136m overall.
Its latest round was funded by Tencent, DST Global, Peter Thiel’s Valar Ventures and VC Alven, plus angel investments from TransferWise cofounder Taavet Hinrikus and Ingo Uytdehaage, CFO at Adyen.
8) Satispay raised €93m (Nov)
Italian fintech Satispay secured €93m in new funding in November, in a round that included investment from Twitter founder Jack Dorsey’s payments company Square, and China’s Tencent.
Founded in 2013, Satispay is Italy’s largest mobile payment provider, serving over 130,000 stores, including chains like KFC, Carrefour, Burger King and Auchun.
The company plans to use the new funding to expand in Italy and abroad, after already moving into Luxembourg and Germany. To date, it has raised a total of €110m.
9) Mollie raised $106m (Sept)
Dutch payments unicorn Mollie raised $106m in September to grow its API payments plug-ins.
The funding, led by TCV, secured the company’s unicorn status.
“We saw a huge influx of new customers and a big increase in volumes,” said Ken Serdons, Mollie’s chief commercial officer, at the time.
“The coronavirus pandemic meant we probably gained a couple of years worth of growth in a short time. But the good thing is that the business grew faster in July than it did in June so it is not just a coronavirus effect, that trend is still continuing,” said Serdons.
10) N26 raised $100m (May)
German digital bank N26 raised $100m in May, extending its Series D round from last year to $570m.
N26 is Germany's most highly-valued fintech at $3.6bn, and reports more than 5m customers across its various geographies.
In February, the German fintech announced it was leaving the UK, after launching in the country in 2018 with the aim of taking on local competitors Monzo and Revolut.
A joint investigation by Sifted and Germany’s Finance Forward in March found that N26’s UK division took a series of blows in the months prior to the announcement, including a run-in with the UK’s Financial Conduct Authority (FCA), a series of high-level resignations and low user engagement.
The company says it would consider an IPO in 2023 at the earliest.
